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2025 DIGILAW 181 (KER)

KEERTHI S. S/o. SUBRAMANIAN, v. STATE OF KERALA

2025-02-04

GOPINATH P.

body2025
JUDGMENT : The petitioners are licensees of certain toddy shops under the Kerala Abkari Shops Disposal Rules, 2002 (hereinafter referred to as ‘the Rules’). They have approached this Court, being aggrieved by the fact that proceedings have been drawn up against them, suspending their license without affording to them any opportunity of being heard and without affording to them any opportunity to show cause against the allegations raised against them. 2. Learned counsel appearing for the petitioners would submit that, in W.P.(C) Nos. 46808 of 2024 and 1308 and 1310 of 2025, the allegation that led to the suspension is that the petitioners have permitted the operation of the toddy shops in question through a benami (namely one Sreedharan) while the allegation that led to the suspension of the license of toddy shops (which is the subject matter of W.P.(C) No. 46607 of 2024 is that, certain spirit was found and it is suspected that the same was being taken to mix with the toddy to be supplied in the shops which are subject matter of W.P.(C) No.46607 of 2024. 3. Learned counsel appearing for the petitioners would submit with reference to the provisions of Section 26 of the Abkari Act that Section 26(b) of the Abkari Act was specifically invoked to suspend the licenses in these cases. He further contends that even if the entire allegations are admitted, the offence is compoundable under Section 56(b) of the Abkari Act. Therefore, he vehemently contends that the suspension of the license should have been preceded by a notice even if the statutory provisions do not specifically contemplate the issuance of such notice and an opportunity to be heard. It is submitted that the rules of natural justice have to be read into the statutory provisions. It is submitted that, when the consequences of a suspension are drastic and cause economic loss and loss of livelihood to the petitioners and also to the workers, the action should have been preceded by notice and personal hearing. It is submitted that the charges upon which the power of suspension has been exercised are all flimsy grounds and if the explanations submitted by the petitioners had been considered and had they had been heard by the officer, the power of suspension would certainly not have been exercised. 4. It is submitted that the charges upon which the power of suspension has been exercised are all flimsy grounds and if the explanations submitted by the petitioners had been considered and had they had been heard by the officer, the power of suspension would certainly not have been exercised. 4. Learned Government Pleader, on the other hand, refers to the statutory provisions and contends that where the trade in question is a trade in liquor, the petitioners enjoy no fundamental rights and their right to trade in liquor is always circumscribed by the statutory provisions. It is submitted that the power of suspension must be treated as distinct from the power of cancellation and while cancellation can only be with notice and after affording an opportunity of hearing, the power of suspension cannot be curtailed by any such requirement as there may be situations where the power of suspension has to be immediately exercised. It is submitted that, in the facts and circumstances of these cases, the power of suspension was exercised for good reason and on the petitioners submitting their explanations, the issue will be decided by the competent authority without undue delay. 5. Learned counsel appearing for the petitioners would submit, in reply, that each case will have to be dealt with its own facts and while certain circumstances may arise where the power of suspension has to be exercised immediately and without having to wait for the compliance with the compliance of principles of natural justice if the circumstances of the case do not reveal that the power of suspension had to be exercised immediately, the petitioners are still entitled to contend that the power of suspension should have been exercised only with notice and after affording an opportunity of hearing to the petitioners. In support of his contention, he relied on the judgment of this Court in Banerji Memorial Club v. Dy. Commissioner of Excise; 2009 SCC OnLine Ker 3376 6. Having heard the learned counsel appearing for the petitioners and the learned Government Pleader, I am of the view that the petitioners have not made out any case for grant of relief. As rightly pointed out by the learned Government Pleader, suspension of the license and cancellation of the license stand on a different footing. Having heard the learned counsel appearing for the petitioners and the learned Government Pleader, I am of the view that the petitioners have not made out any case for grant of relief. As rightly pointed out by the learned Government Pleader, suspension of the license and cancellation of the license stand on a different footing. While cancellation should normally be preceded by notice and an opportunity of hearing, a suspension (especially when the license is one for trading in liquor), need not be preceded by notice and an opportunity of hearing. It would also not be appropriate or in the public interest to enumerate the circumstances in which the power of suspension can be exercised only with notice and other circumstances where the power of suspension can be exercised without notice. There may be several circumstances which may not be in the contemplation of the Court or the parties which may require the authorities to exercise the power of suspension forthwith and without having to wait for issuance of notice and affording an opportunity of hearing. 7. The contentions raised on the basis of the provisions in Section 26 of the Abkari Act must fail. Section 26(b) of the Abkari Act reads thus: “Section 26. Power to recall licenses, etc.-- The Commissioner may cancel or suspend any license or permit granted under this Act:- (a)………… (b) in the event of any breach by the holder of such license or permit or by his servant, or by anyone acting with his express or implied permission on his behalf, of any of the terms and conditions of such license or permit; or (bb) - (e) …….” A reading of Section 26 of the Abkari Act indicates that the provision contemplates both suspension and cancellation. Even if a specific power of suspension is not contemplated by the Statute, a power of cancellation would also include the power to suspend a license in appropriate circumstances. The fact that an offence under Section 26(b) is compoundable does not lead to a conclusion that the licence cannot be suspended for an alleged violation of the provisions of Section 26(b). 8. The contention raised on the ratio of Banerji Memorial Club (supra) must also fail. The relevant portion of the said judgment reads thus:- “7. ……. The fact that an offence under Section 26(b) is compoundable does not lead to a conclusion that the licence cannot be suspended for an alleged violation of the provisions of Section 26(b). 8. The contention raised on the ratio of Banerji Memorial Club (supra) must also fail. The relevant portion of the said judgment reads thus:- “7. ……. The power to suspend, as that term indicates, is necessarily a power to impose a temporary measure, which would be prohibitory in nature. However, a power to cancel is the power to make the absolute order determining the license. …………. Power to suspend is one envisaged for putting on immediate, but temporary, stoppage of that which is suspended. This means that the power to suspend is to be invoked and enforced when the situation warrants an immediate prohibitory intervention. ………….These provisions, when contrasted with S.26(b), tend to show that while on grounds referable to any of the aforesaid provisions, viz, (a), (bb), (c) or (e), it may provide for immediate suspension, all cases which fall under S.26(b) would not call for suspension. That may depend from case to case, depending upon the nature of the breach of the terms of license. It would also depend upon that term or condition of license, which is allegedly breached.” (emphasis supplied). I am in complete agreement with the views taken in Banerji Memorial Club (supra) and I am of the opinion that the judgment is authority for the view I have taken. Therefore, I am unable to accept the contentions raised by the learned counsel appearing for the petitioners that the orders of suspension in these cases are to be set aside on the ground that they have been issued without following the principles of natural justice. Writ petitions fail and they are accordingly dismissed.